Talk:Asset-backed security
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Comments to Asset-Backed Security page —Preceding unsigned comment added by 216.89.93.4 (talk) 18:10, 25 September 2007 (UTC) The second paragraph under the heading "Credit Card Receivables" is a general comment on structures used in securitization, it has only a minor bearing on credit cards as some tweaks are made to the structure to accommodate credit card asset-class specific characteristics (revolving rather than static collateral pool). The second paragraph is better deleted and moved to the "Securitization Transaction" page. While the definition of asset-backed security at the top of the page from Reg AB is useful, the rest of the inclusions from that issuance are pretty random. It mentions lease-backed securities but ignores the much more important exclusion of CDO structures in general and synthetic CDOs specifically. |
correction
[edit]while also reducing risk by diversifying the underlying assets.
This is a fairly common misunderstanding as the diversification only reduces the standard deviation of the risk but not the risk overall. Means: The chance to get struck by an unusual high (or low) failure falls and the risk will be nearer to the statistical average but that´s not the risk itself.
The variance IS the risk. — Preceding unsigned comment added by 188.222.90.170 (talk) 17:07, 14 March 2013 (UTC)
commercial paper vs. security
[edit]Is there any difference between asset-backed security and asset-backed commercial paper? Or they are only two names for the same thing? ——Nussknacker胡桃夹子^.^tell me... 10:36, 16 October 2007 (UTC)
- The difference is this --- if one issues Commercial Paper and another then 'backs' it (i.e., attaches as collateral for the debt itself) with assets and trades it in a market (this action being known as 'securitizing'), then that CP becomes asset backed commercial paper (ABCP), which is an asset backed security. Read about securitize.
Copyright issue !!
[edit]Too much use from Dwight asset management material here ! It should have been rewritten
bankruptcy remoteness
[edit]Why is it claimed in the article that ABS are of the kind of "bankruptcy remoteness"? Must ABS always be issued by an SPV/SPE or can ABS be also issued by the originator? For example, Bank A holds chashflow producing assets, and it issues an ABS based on those cashflow producing assets. The issuer of the ABS would be Bank A, and no SPV/SPE would be created for that purpose. This sort of ABS would not be of the kinda of "bankruptcy remoteness" and in my view still be ABS (against the view presented in the article)? /Fin_Pat
- ABS can be issued by the originator, although the practice is to remove it even from the effective issuer - as in, if Goldman wants to issue an MBS based on Northern Rock's mortgages, it will create an SPV and distance itself from the deal. Does that make sense? Nshuks7 (talk) 08:52, 14 February 2009 (UTC)
home equity loan = mortgage loan
[edit]Are home equity loans the same as mortgage loans; if so, I suggest this is made clear in the article? 128.243.253.101 (talk) 16:53, 26 June 2010 (UTC)
Default
[edit]We should have a section to cover what happens to the credit-card ABS when the credit card holders go into default. Malke 2010 (talk) 23:07, 23 February 2012 (UTC)
The latter parts of this article are horribly written. — Preceding unsigned comment added by 188.222.90.170 (talk) 17:09, 14 March 2013 (UTC)
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